NYDFS issues first BitLicense to Circle

The New York Department of Financial Services (NYDFS) announced today it has approved Circle Internet Financial Ltd.’s BitLicense application, making the Boston-based Bitcoin company the first firm to receive this license.

Anthony J. Albanese, the NYDFS’s acting superintendent, said in a press release that “issuing the first BitLicense is an important milestone in the long-term development of the virtual currency industry. Putting in place rules of the road that help protect consumers from loss or theft and root out illicit activity is vital to building trust in this new financial technology. We will continue to move forward on evaluating and approving additional BitLicenses.”

The Wall Street Journalreported that with the BitLicense, Circle can now offer a mobile payment service that can send, receive and hold U.S. dollars as well as Bitcoin. With the revised service, users can send and receive payments by text message. The service does not make users convert into and out of Bitcoin, as that is handled by the platform automatically, said the newspaper. Other currencies, such as the euro, will be added as Circle attains regulatory approval overseas, something the company is pursuing.

The Wall Street Journal reported that the announcement of the BitLicense approval came as Circle released a new version of its online service called CirclePay, which aims to make digital payments more appealing.

“We’re pushing bitcoin into the background for the sake of bringing bitcoin to more people,” said Circle CTO Sean Neville to the Wall Street Journal.

Circle Internet Financial Ltd. CEO Jeremy Allaire.

Neville, along with CEO Jeremy Allaire, published a blog post today about the company’s new suite of CirclePay mobile and Web applications. Among the new features is that debit cards are now free and instant. If a user funds their Circle account with a debit card, they receive the money instantly with no fees charged. There is also a new higher limit for cashing in and out and spending; most customers will begin with a $300 USD weekly limit and have the chance to upgrade to $3,000. Circle also has insurance from the Federal Deposit Insurance Corporation on USD deposits, which the company said complements its existing full insurance protection over customer Bitcoin funds.

Neville and Allaire mentioned in the blog post the company’s full compliance with New York’s money transmitter and BitLicense regulations.

“We’ve been fairly vocal about our concerns with the BitLicense, especially in its initial incarnation,” said the pair in the post. “Many of those issues were resolved, and though still not perfect, the BitLicense and its requirements became clear and irrefutable prerequisites for serving and supporting everyone in New York.”

The Wall Street Journal said the debate continues about how much the BitLicense has affected the business environment for Bitcoin. Several firms have ceased business in New York state due to the license, but a number did apply for it.

The NYDFS said 22 companies have applied for the BitLicense, which involves a $5,000 application fee, and it expects more approvals soon.

“We are trying to move expeditiously,” said Matthew Anderson, the department’s superintendent for public affairs, to the Wall Street Journal.